CIOs lead IT sustainability as strategic partners in the digital age

The changing role of the CIO

The role of the CIO has been crucial to business success since the 1980s. Ever since it has overseen the implementation and management of technology. And also ensures it supports company objectives.

However, the rapid digitisation of the economy and growing reliance on technology for product and service innovation have prompted a major shift. In the IDG’s 2020 report, 95% of CIOs¹ stated their role is expanding beyond traditional IT management, with strategic tasks increasing from 4% to 25%. This article explains how CIOs lead IT sustainability as strategic partners in the digital age.

CIOs lead IT sustainability as strategic partners

Awareness of technology’s environmental footprint is growing. This leads to the expansion of the CIO’s role. CIOs are no longer limited to IT management. Instead, more and more CIOs lead IT sustainability as strategic partners.

They use technology to generate revenue and achieve company objectives. At the same time, they ensure organizations reduce their environmental impact and remain competitive among customers, employees, and investors.

IT sustainability in the Digital Age

So how do CIOs succeed in such a major shift? CIOs are harnessing data to implement green corporate strategies. They use technology, people, and processes to measure emissions, find ways to support a circular economy and decarbonize their operations.

How data help CIOs lead IT sustainability as strategic partners?

1. Gaining clarity with data & insights

Firstly, CIOs succeed, because data and insights help CIOs gain clarity. Growing demand for the manufacture of new equipment and poor asset management release vast quantities of CO₂ and greenhouse gases into the atmosphere, warming the climate. In the last decade, the total life cycle carbon footprint of the IT sector accounted for approximately 1.4% of global greenhouse gas emissions ². With 60-80% ³ of them coming from the production and use of terminal equipment.

A Deloitte survey⁴ of 2,000 C-suite executives in 21 countries states nearly a third had difficulties measuring their organizations’ environmental impact. CIOs can measure, monitor, and track a company’s carbon footprint, leveraging data metrics from enterprise applications and integrated platforms. Such as greenhouse gas emissions, water usage and energy consumption.

CIOs can create greater internal visibility with improved data sourcing and collection.
To identify: areas of inefficiency, excessive emissions or waste and implement appropriate countering strategies.

One example is to migrate nonessential and mission-critical business functions to the cloud, with research finding that enterprises moving from on-site data centres have experienced energy savings of 80% ⁵.

Yet, mass use of new technologies, such as the cloud, can also be very energy intensive.
They are predicted to account for 8% of global electricity consumption by 2030 ⁶. So it is key that CIOs partner with providers committed to carbon neutrality and use renewable energy sources.

In addition, emerging regulations demand increasing future disclosure from business.
In March 2022, the Securities and Exchange Commissions (SEC) voted to propose regulations. It ‘for the first time, requires companies to disclose their greenhouse gas emissions as well as their exposure to climate change risks.’‘SEC proposes first climate disclosure rules for public companies.’ ⁷

Thus, it is beneficial for CIOs to establish robust and accurate data collection and monitoring practices, to save on potentially costly mandatory implementation down the line.

2. Building trust with transparency & communication

Secondly, CIOs succeed when building trust with transparency and communication.

• 98% of consumers ⁸ now believe brands have the responsibility to make the world better.
• Moreover, employees want to work for businesses that prioritize sustainability and embody personal values ⁹ .

In other words, awareness of technology’s footprint grows. And CIOs face stakeholder pressure to optimize their IT and align it with a greener economy. Therefore building trust with transparency and communication is vital.

• CIOs leverage data to demonstrate transparency and accountability for enterprise environmental impact. In this way, they help to build trust among all stakeholders. Including customers, employees & investors.
• CIOs use organizational data alongside their technical knowledge and communication skills.

Having a common enterprise-wide understanding of the issue and defining targets that align with the overall sustainability strategy, will help the entire business collaborate effectively. CIOs encourage collaboration, create meaningful change towards green IT and increase understanding. They also facilitate productive discussions and strategy development with executives and across many different departments.

• Moreover, sustainability is a long game. Strategies that reduce environmental impact and create efficiency in the future may be more costly than maintaining the status quo in the short term. Therefore, effective presentation and communication of data is essential. In this way, CIOs can tackle potential apprehension from executives and other business leaders. Also to demonstrate how sustainable technology will support the overall success of the company long-term. And work with them to delegate resources in establishing a clear roadmap.

3. Establish external partnerships

Thirdly, establishing external partnerships. CIOs must also be able to establish external partnerships by exchanging relevant knowledge and insights, to meet regulatory demands and improve sustainability across the IT industry.

This includes communicating with vendors and suppliers and optimizing supply chains, which are responsible for approximately 80% of an organization’s emissions ¹⁰.

4. Joining the circular economy

Fourthly, joining the circular economy. 49% of organizations ¹¹ say implementing sustainable IT initiatives is a major challenge due to the lack of tools to evaluate their IT carbon footprint. In this capacity,

• data is also helping CIOs combat carbon emissions and waste by assessing the impact of their processes, including the procurement and use of equipment, and adjusting them so they support the circular economy.

According to Gartner ¹², CIOs are investing in innovative technologies such as AI and the Internet of Things (IoT) to improve the material sustainability of their tech. This includes the use of sensors that track the origin of a particular product, or AI signals to alert when a piece of equipment requires refurbishment.

5. An analytical approach to IT Asset Management (ITAM)

Fifthly, Sustainable IT technologies help to create a more analytical approach to IT Asset Management (ITAM).

These technologies can help inform a more analytical approach to IT Asset Management (ITAM) that encompasses acquisition, operation, and disposal to ensure maximum economic, material and environmental value of IT infrastructures at every stage of the lifecycle.
In practice,

• It procures high-quality refurbished assets from a reputable supplier instead of refreshing new equipment.
• It also includes opting for a third-party maintenance service to support IT assets post-warranty

It offers a way to extend the useful life of equipment and avoid costly restrictions and refresh cycles imposed by manufacturers.

IT Asset Management strengthens the circular economy

More broadly, as more CIOs adopt this approach, ITAM contributes to a weakening of the widespread practice of planned obsolescence, huge amounts of functional equipment and reusable raw materials.

Moreover, once a business no longer requires a piece(s) of hardware, CIOs can generate extra revenue with a buy-back service, and if at its true end of life, give raw materials a second life by opting to recycle.

More and more switching to this approach strengthens the establishment of a circular economy in IT. CIOs are therefore protecting their budget by reducing the Total Cost of Ownership (TCO). And they are also protecting the environment, as they prevent harmful e-waste and emissions at every stage of the hardware lifecycle.

Summary

In conclusion, the increasingly digital nature of global business is not slowing down. The data centre industry is expected to grow by 500% by 2030 ¹³. This makes it even more vital that CIOs take a leading role in contributing to industrial efforts and establishing the path to a less damaging digital future. CIOs lead IT sustainability as strategic partners in the digital age:

• using data to innovate new strategies
• encourage collaboration to create meaningful progress
• focusing on long-term solutions with the breadth and complexity to handle future challenges
• prioritizing investments
• and making key business decisions

Only in this way, technology will become a key agent in actioning a brighter, more sustainable future for us all.

Sources

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7. Freedman, Andrew. 2022. ‘SEC proposes first climate disclosure rules for public companies.’ AXIOS. March 21, 2022.
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